As eCommerce continues to increase across all retail sectors, new markets become increasingly important for eCommerce merchants. Entering new markets requires careful evaluation of relevant market factors. Successful eCommerce merchants operating in a cross-border model focus on a variety of success factors including streamlined retail offers, efficient product delivery and logistics, consolidated payments processing solutions, and advanced risk and fraud tools.
This presentation will address the important success factors that cross-border eCommerce merchants should consider. US-based merchants have many considerations when entering global markets; ISOs and sales organizations should understand the success factors in order to best advise their clients.
Additionally, the presentation will discuss which international markets have appealing business conditions for US merchants, along with best practices for engaging local resources and established providers in these markets to enable successful payments processing and other key merchant services.
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CNP EXPO Payvision on Expanding from the US to global markets
1. EXPANDING FROM THE US
TO GLOBAL MARKETS
19th of May, 2014
CNP EXPO | Orlando, Florida
Joe Emig |VP Global Business Development, International Acquiring
Payvision
2. “s-commerce”: 1500’s
• Ships. Advances in shipbuilding
technology opened up the world
for exploration and commercial
activities that never existed
before.
New trade partners
New currency markets
New goods and services
New global relationships
• This led to the creation of new
political empires and major world
economies which still exist today.
3. State of e-commerce today
• 20 years after the “dot com boom”, e-commerce is just starting to
explode
• Global e-commerce has been growing at a rate of 19% per year,
with many markets experiencing triple-digits growth
• By 2015, global e-commerce sales will exceed $1.4 Trillion
5. Identifying the “hot” markets for
e-commerce
• Early e-commerce markets have matured, but this does not mean
that the “gold rush” is over.
Mature e-commerce markets are ripe for commercialization due to their
established e-commerce infrastructures, incubated technologies that have
flourished amidst market forces, and a developed e-commerce purchasing
culture.
For example, in the USA we see a robust population with internet access and a
rapidly-increasing percentage using mobile devices for e-commerce activities.
6. • In the UK, we see similarly high percentages of internet penetration
and mobile device-enabled e-commerce activity.
Identifying the “hot” markets for e-commerce
7. • Surprisingly, we see similar e-commerce growth in evolving markets
which do not have the same established infrastructure and
technology base as the mature markets:
“There is a remarkable consistency in e-consumer purchase behavior
across all territories and demographics, whether consumers live in a
mature, developed, or developing market. Consumers are becoming
experts in multi-channel shopping, buying across a great variety of
retail, product categories online. Online shoppers will ultimately select
those online retailers with a good online reputation, a user-friendly
website, and fast, reliable, and free delivery.”
Payvision report: Profitable Cross-Border E-Commerce Industries 2013
8. Identifying the “hot” markets for e-commerce
What about the BRIC countries?
• Brazil: Massive internet penetration, rapidly-expanding e-commerce culture,
developing “dot com” mentality.
Cautions: challenging banking and regulatory environment for merchants recent
governmental restrictions on international DCC transactions
Grade: B
• Russia: Massive internet penetration, advantageous proximity to established
e-commerce regions (Western Europe, Asia Pacific)
Cautions: disproportionate frequency of fraud, lack of established cross-border acquiring
programs, lack of adoption for e-commerce by card issuers.
Grade: C
• India: Enormous potential population for e-commerce, lack of domestic e-
commerce development means an untapped marketplace for global
merchants, booming technology sector with rapid adoption of global tools .
expanding consumer base with purchasing power.
Cautions: Inexperienced merchant base and underdeveloped card-issuing programs
make it difficult to fully tap into the market.
Grade: B+
9. Identifying the “hot” markets for e-commerce
• China: Enormous potential population for e-commerce, massive
internet penetration, developed technology infrastructure, established
card-issuing programs, expanding consumer base with purchasing
power
Cautions: Language barrier inhibits western e-commerce providers from
accessing the market, significant governmental/regulator schemes create
difficulty for cross-border interactivity and logistics. Grade: B+
• Other “hot” markets: Japan, Taiwan, South Korea, Malaysia, Mexico,
Chile, Argentina, Australia
10. E-commerce logistics
• A business plan can be very sophisticated, but
at the end of the day a merchant cares about
one thing above any other: getting paid.
Engage with a payments processor that has
experience in the merchant’s key countries/markets.
Understand the payments landscape of the key
markets, i.e. be familiar with local pricing norms
and common payment types.
Offer your products/services in the local currency.
• Merchants should establish their business in
each market with an image of credibility and
competency. If your customers view you as a
“tourist” in their market, they will NOT trust
you with their business.